Dear reader,

2024 is behind us. A year where we saw a return to calmer waters. A good year, in the sense that the energy transition’s momentum became unstoppable. And even though some of us may be clinging to fossil fuel because of its short-term profitability, the detractors, too will have to concede that the supply of fossil fuel on the longer term is finite. Capgemini’s CIO Pascal Brier mentioned this at our recent Innovation Day: even if you don’t believe in the energy transition on its own merits, we will have to make sure the alternative is in place at scale by the time fossil fuel sources run out.

At the same time, and with the energy transition in full swing, we are already seeing new challenges emerge. In the Netherlands, electrification of our society is progressing too fast for our infrastructures to keep up with. At Capgemini, we’re doing what we can to support our customers in dealing with this, and to help them accelerate solutions that counter net congestion. Plus, we’re assisting customers such as Eneco in their quest for net zero , and in finding new ways to stay profitable while weaning themselves off of gas as their primary source of income. And of course, we’ve got our own net zero ambitions to fulfil.

With all that’s happening on the energy front, there’s a real danger of becoming complacent. And we really can’t afford this. The conclusion of our recent World Energy Markets Observatory report was stark: we are not on track to meeting the objectives of the Paris Agreement. Fossil fuels still account for almost 90% of global carbon dioxide emissions. We really, really need to turn this ship around – if not for our own sakes, then for the generations coming after us. We’re trying to do our part, partnering with like-minded companies to safeguard a greener future. And as always, technology is our main ally in bringing about the change we seek. In 2024, we struck a deal with Equigy ; together, we’re developing a grid balancing platform that will pave the way for a more flexible, sustainable, stable and efficient energy system across Europe.

In all of this, GenAI is spearheading our efforts. GenAI will help us to find new business opportunities for our customers, and establish long-lasting, personal customer relationships – made possible by adaptive, AI-driven CX. For us, 2024 was the year where GenAI grew into its own as an indispensable driver of profitability and sustainability, and a world where convenience and corporate responsibility go hand in hand. At our Innovation Day, our partner Eneco discussed how they’re integrating AI to uncover new ways to support their customers, complete the transition towards renewables, and safeguard the sustainable future of the company.

So, what will 2025 bring? We expect that the demand-side energy transition will expand. Customer expectations, infrastructure limitations and the shift towards volatile renewables will require the sector to do much more than just supply energy; we need to actively manage, balance and optimize supply and demand, and empower our customers to take control of their own energy landscape. In 2024, the groundworks for this were put in place; 2025 is where we really start giving shape to the future of energy. We look forward to doing so together with you.

All the best,

Lars Falch

VP Energy and Utilities
Capgemini Invent

Bart van Nijnatten

Head of Energy
Utilities

Business, meet planet: Eneco’s AI-powered quest for net-zero

The theme of 2024’s Capgemini Innovation Day was ‘Business, meet planet’. We had quite a few distinguished guests on stage, talking about the ways they are working to secure a sustainable future for their organizations and for the world at large. Also on hand was Eneco’s Jeroen Ronckaerts. With Capgemini’s Marc Peeters, he discussed Eneco’s and Capgemini’s new partnership: together, the companies are hoping to reduce Eneco’s annual carbon footprint by 1 megaton by 2030. It’s a significant step towards realizing Eneco’s One Planet Plan: the company aims to be net zero by 2035. Ronckaerts: ‘Capgemini is helping us with 1 megaton, but we still need to do much more. In the footprint of our operations, but also of all of our customers. It’s a huge challenge.’

To reach its goals, Eneco is expecting a lot from AI. And the company is investing heavily in it; for instance, 62% of its CX budget is currently allocated to AI. Ronckaerts: ‘We make most of our money from selling gas. If we don’t want to sell it anymore, we need to find a new way to become financially sustainable. We can compensate for revenue drops by selling more electricity, and more services. We’re finding out how to strategically implement AI across the organization, how to realize our business goals with GenAI, and how to democratize AI for innovation and sustainability. And: how we can leverage AI for more humanized personal contact.’

All in all, AI is affecting everything. There’s a huge change in front of Eneco. And the implementation of AI across the company may sound daunting, but Eneco seems to have found a simple strategy: Buy, Build, Use.

‘Buy’ means: buying ready-to-use software from big players, or from niche players for particular challenges. For instance, when an email comes in at Eneco’s customer service center, Microsoft Dynamics 365 provides support by suggesting a reply to Eneco’s agent. Of course, this saves a lot of time.

‘Build’ means, in Ronckaert’s words, ‘to locate a competitive advantage and built the application we need ourselves.’ In 2023, Eneco built its own ‘next best action engine’, a tool that helps to increase customer value through AI-driven communication. It consistently uses the right channel at the right time to provide content to (potential) customers that adds value and optimizes conversion. And along the way, it supports Eneco in developing and selling products and services that decrease individual customers’ carbon footprints.

In another example, Eneco is working to offer AI-driven connected services that help customers to manage the way they use energy. This has positive financial results for both the customer and Eneco itself: ‘Based on AI-powered forecasting, we offer incentives to customers to help us with our balancing act of energy supply and demand. For instance, we ask a customer to charge their car not now but in two hours, and offer a little discount as a reward.’

In something that Ronckaert calls the ‘holy grail’, Eneco is trying to come up with a solution to predict customer churn and act accordingly: ‘If you’re staying with us we don’t need to contact you. If you’re leaving anyway, we don’t need to contact you. If you’re valuable to us and may be willing to stay, you’re in the holy grail quadrant.’ With the assistance of Capgemini, Eneco is improving its data models to make such granular prediction possible. It’s a large challenge, but the company is determined to ‘crack the case.’

Of course, Eneco also has to make sure all the colleagues across the company can make optimal use of the increasing range of AI-powered solutions. That’s the ‘use’-part of Eneco’s approach: ‘We’re teaching everyone to work with it. We’re training people in prompt engineering, applying it to uses cases that resonate with them. So far, we’ve trained 300 colleagues, and use of AI has been increasing steadily.’ As an example, Eneco is employing AI tools to automate content creation. This will allow the company to save costs, because employing or hiring people to create content will no longer be necessary. But of course, this only works of the people at Eneco actually use the tools they’re provided with. That’s why the ‘Use’-part of its strategy is so important.

Eneco’s AI strategy is a perfect example of how to let technology contribute to several goals at once: to improve CX, to protect the bottom line in times of disruption, and to work towards that ultimate goal: net zero by 2035. It’s a great journey, and at Capgemini we’re happy that we’re along for the ride.

Whspr: The Silent Heat Pump

In 2022, Eneco joined forces with Capgemini. Through their partnership, they aim to reduce Eneco's carbon footprint by 1 megaton by 2030. They are working together on a silent heat pump, for which a startup was founded: Whspr. Below, we tell you how this came about.

The energy transition is in full swing. This energy transition affects everything and everyone. And the consequences are visible everywhere. For example, more and more heat pumps are appearing. With a heat pump, we can heat our homes in a sustainable way – and eventually, our energy bills will go down as well.

Pros and Cons

This is also important for energy suppliers. Take Eneco: this company wants to be net zero by 2035. Knowing that 90% of Eneco's footprint is scope 3 emissions, you understand that making homes and buildings CO2-neutral plays a major role. And it helps enormously if as many buildings as possible have a heat pump.

However, heat pumps have a few drawbacks. The installation requires a lot of knowledge and expertise; your regular heating engineer usually can't do it. And, more importantly, heat pumps make noise. So much so that they cannot be used in neighborhoods where houses are close together. This keeps the heat pump out of reach for many Dutch people.

Achievable Goal

Couldn't we develop a heat pump that is so quiet that everyone can put it in their backyard without bothering the neighbors? A heat pump that can also be installed by any decent plumber?

That was the winning idea during one of the pitch competitions that Capgemini and Eneco organized together as part of their new partnership. The idea was conceived by Hugo Huis In 't Veld and Hans Cool. Hugo and Hans got the chance to realize their idea, and work on the concept with a hand-picked team. Capgemini provided the necessary engineers and designers. In May 2024, Hugo and Hans founded Whspr.

With technical operability, user experience, manufacturability, and ease of installation as starting points, the team got to work. Always with a realistic end goal in mind, fully focused on feasibility; what is deliverable, at what cost, and what weight? Are only standard materials and production methods really needed to make it? And what is the right sizing? Capgemini's engineers focused on technical aspects such as flow design, sound design, and construction; designers from Capgemini's Frog division focused on the user experience, with customer-oriented innovation as the starting point.

Three and a half months later, the design was ready. Including 3D CAD drawings, P&ID, a Bill of Materials, renders & exploded views, and documentation of all design choices. A design that passed all virtual stress tests with flying colors. Conclusion: It can be done. Whspr works!

Democratization

The potential is enormous: over 40% of Dutch housing consists of terraced houses, which often cannot have a heat pump due to noise standards. Whspr offers a solution for those households, at a net investment of around 3000 euros.

Moreover, Whspr's heat pump is so simple that it can be installed by one person within one day. Without the need for additional diplomas or extra experts. There are between 15,000 and 20,000 professionals active in the heating and installation industry in the Netherlands; they can all handle the Whspr. This makes the supply chain around heat pumps much simpler and faster. The large-scale installation of heat pumps is thus much closer. You could also say: Whspr democratizes the heat pump.

For Eneco, this is an opportunity to significantly reduce Scope 3 emissions. No wonder Eneco is gearing up to be the launching customer for Whspr. Whspr hopes to introduce the silent heat pump to the market in the 2026 heating season. The heat pump will then be available for purchase at Eneco. And with that, Whspr will get off to a great start.

Capgemini's World Energy Markets Observatory Annual Report 2024

In the latest edition of Capgemini's World Energy Markets Observatory (WEMO) report, the stark reality of our current energy transition efforts is laid bare. Despite significant advancements in renewable energy development in 2023 and optimistic projections for 2024, the pace of progress remains insufficient to meet the ambitious goals set by the Paris Agreement. Still, while those goals are no longer achievable, net zero by 2050 is still possible – if we accelerate our efforts.

Key insights from the report include:

Renewable Energy Deployment

The deployment of renewable energy needs to be hastened globally, especially in developing countries, to meet the 2030 and 2050 decarbonization goals. In 2023, renewable energy capacity increased by 14%, with solar energy expanding by 32% and wind by 13%. However, this growth is still far below what is needed to achieve net zero carbon by 2050.

Nuclear
Energy

Global nuclear capacity needs to triple to ensure stable, low-carbon power. While there is promising progress in the nuclear renaissance, including SMRs, the development of new nuclear power plants remains challenging. In 2023, 440 nuclear reactors provided 9% of the world's electricity and 25% of the world's low-carbon electricity.

Power Grid
Investment

The power grid plays a fundamental role in accelerating clean energy transitions. Grid investment is expected to reach USD 400 billion in 2024, with Europe, the United States, China, and parts of Latin America leading the way. Technologies such as AI will help improve grid balancing and forecasting electricity consumption. Still, whilst AI has the potential to significantly accelerate decarbonization, a lack of skills and a focus on short-term proof of concepts is hampering adoption to date.

Hydrogen as a Strategic Lever

Hydrogen is identified as a strategic lever in the decarbonization path. The number of projects reaching final investment decisions has quadrupled over the last two years. However, the increasing costs of low-carbon hydrogen production and competition between uses necessitate a refocus on applications in 'Hard to Abate' industries, such as heavy industry and maritime mobility.